In what has been described as a "scathing letter" sent to Yahoo! Chairman Roy Bostock on Friday, billionaire investor activist Carl Icahn insisted that Yahoo tell Microsoft that it's willing to be sold for $49.5 billion, approximately $2 billion above Microsoft's last offer for the company, made last month."Why don't you stop dancing around the subject and publicly offer to sell the company to Microsoft for $34.375 per share and promise to cooperate completely?" Icahn wrote in his strongly worded missive last week, USA Today reported. Yahoo said in return that declaring a sales price for the company would be "ill advised" while Microsoft declined to comment. The negotiations between the Yahoo! and Microsoft have been plagued by rumours and difficulties - making it one of the year's most absorbing search-sagas.
Icahn's letter was another strike in what is fast becoming a bitter campaign to force the sale of Yahoo!. He's long demanded that Yahoo! cancel a severance plan that would award accelerated benefits to the bulk of Yahoo! staff in the event of a takeover and in previous letters he's stated that he wants CEO Jerry Yang fired and the board of directors replaced should the company fail to work out a deal with Microsoft before Yahoo!'s annual shareholders meeting on August 1st.
Carl Icahn's threats should not be taking lightly by Yahoo!. Icahn developed a reputation as a ruthless corporate raider following his hostile takeover of Trans World Airlines in 1985, following which he systematically stripped TWA of its assets and sold it off. These latest communiqués sent to Yahoo! have led some tech analysts to suggest that Icahn is merely softening Yahoo! up in the run up to its shareholders meeting, to be in San Jose, California. Should Yahoo! stave off Icahn, the company could face a myriad of lawsuits from disgruntled shareholders, says Jonathan Yarmis, an analyst at AMR Research".
"I'll bet after the shareholders meeting — if there's no deal done — you'd have a hard time booking a hotel room in Wilmington, Del., as plaintiffs' lawyers line up to file their lawsuits," the analyst told USA Today. Yarmis also agreed with several other web experts, when discussing Icahn's reasons for pressuring a sale of Yahoo! to Microsoft.
With control of Investment Funds holding about 59 million shares, it seems that Carl Icahn is on a poison-pen crusade that Yahoo! would be foolish to disregard - whether he'll be able to engineer a sale or not is another story.
